A surge in the number of construction activities in Japan has boosted the demand for self-propelled and heavy construction machines such as the excavator. Incredibly useful in excavating, discharging and elevating materials, some of the primary applications of excavators include leveling, trench digging, and sinking of wells. Since 2010, the market for excavators in Japan has been growing at a steady pace, with analysts at Technavio predicting a CAGR close to 18% by 2020.
5 major trends in Japan’s excavator’s market
Remote monitoring systems in excavators
Technology has always played a very important role in improving the performance of machinery. In the case of excavators, one of the latest trends has been the incorporation of GPS (global positioning system) and other satellite remote monitoring systems to monitor the performance and efficiency of equipment outside of the construction site. This enables operators to track multiple machines from any location and instruct them to perform tasks such as accelerating, steering, braking, and avoiding obstacles. Apart from this, the owners of excavators such as contractors and construction companies can easily monitor aspects like the machine history, current machine hours, machine idle time, maintenance information and alarm fault history.
As of now, Hitachi Construction Machinery, Komatsu, and Kobelco Construction Machinery provide remote monitoring systems in their excavators. In fact, the excavators manufactured by Hitachi also have ZXLink remote monitoring systems for other excavators. The ZXLink system is a telematics box that can be installed on any machine by any OEM.
Excavator Market in Japan 2010-2015 (Units)
Source: Technavio
Energy-efficient excavators
Energy-efficiency is the ultimate goal for all organizations. Japan has always had a work culture that promotes energy-efficiency, and when it comes to construction companies, it is even more critical. In a bid to achieve green building certifications for their projects, Japanese construction companies need to minimize the emissions and levels of pollution throughout the life cycle of a project. This has in turn fueled the demand for energy-efficient excavators in Japan. Large investments are being made in R&D efforts to develop energy-efficient and low-emission excavators. Additionally, there is a trend of replacing the existing excavators, which fail to meet the emission standards set by the government, with new energy-efficient ones, leading to growing demand for the replacement of older excavators by construction companies.
Emergence of excavator rental business
Owning excavators requires an immense amount of investment, especially in the initial stage. Not only is this a major constraint for SMEs; given the fact that the construction industry in Japan is quite uncertain in nature, many firms are hesitant to invest in new excavators or get their old excavators replaced. Therefore, there has been a growing trend among manufacturers to promote their excavators through renting and leasing. Leading vendors in the market are offering rental and lease services to their customers. The lease period is generally less than the average lifetime of excavators, which allows construction companies to utilize excavators without major investment. There has also been a surge in the rental of auxiliary services such as specialist consultation and proactive excavator maintenance.
Healthcare facilities and disaster prevention projects
With disasters such as earthquakes a common occurrence in Japan, there has been greater focus on disaster prevention and healthcare facilities projects. Under the Tokyo Vision 2020, the Japanese government has planned to implement several disaster management projects. Use of mini or medium-sized excavators is imperative for the fulfillment of these projects. For example: mini excavators are essential for field investigation, as they can access remote locations with ease. Likewise, a number of healthcare facilities require medium-sized excavators for project completion.
Attractive offers and financing
Lastly, the provision for attractive offers and financing is a major trend in Japan at present. As previously mentioned, the initial cost of owning excavators is quite high, and certain utility contractors and organizations prefer owning excavators rather than renting them. Keeping this in mind, manufacturers are providing these organizations with attractive financing options to increase their sales. Availability of financing for excavators provides companies with the opportunity to procure the equipment with minimal effect on their budget. This is why many excavator manufacturers and dealers are providing attractive offers such as complimentary attachments, accessories, and customization options in order to further increase their sales.
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